Week 2: Managing in a Digital World

1. Week 2: Managing in a Digital World MIS5001: Management Information Systems David S. McGettigan Adapted from material by Arnold Kurtz, David Schuff, and Paul Weinberg

2. Agenda • Group Term Paper • Prior Lecture Recap • Decision Making in the Enterprise • Types of Information Systems • Business Process Management • Google Case Discussion • Next Week

3. Group Term Paper Assignment of Groups

4. Term Paper - Topic • Analysis of a technology that would create significant competitive advantage for a company • Term paper should simulate an internal project approval document (while still including citations as required in academia) • Examples of components: • Solution description • Impact to the company and/or competitive advantage • Business case • Vendor(s) analysis • Implementation approach and timing • See syllabus for grading criteria and timing

5. Prior Lecture Recap

6. Recap • Fundamentals • Components of an Information System • Data, Information and Intelligence • Gaining Competitive Advantage from IT • Barriers to Entry • Distribution Channels • Switching Costs • Innovation in Marketing, Manufacturing and Customer Service

7. Decision Making in the Enterprise No sensible decision can be made any longer without taking into account not only the world as it is, but the world as it will be. Isaac Asimov (1920 - 1992)

8. Decision Making Process • Four phases of decision making • Intelligence – find or recognize a problem, need, or opportunity. • Design – consider ways to solve the problem, fill the need, or take advantage of an opportunity. • Choice – examine the merits of each solution, estimate the consequences of each, and choose the best one. • Implementation – carry out the chosen solution, monitor the results, and make adjustments as necessary. Source; Management Information Systems for the Information Age (Fourth Edition)

9. Decision Types • Structured decision - processes a certain kind of information in a specified way so that you will always get the right answer. • Nonstructured decision - one for which there may be several “right” answers, and there is no precise way to get a right answer. • Recurring decision - one that happens repeatedly, and often periodically. • Nonrecurring decision - one that you make infrequently. Source; Management Information Systems for the Information Age (Fourth Edition)

10. Decision Levels Decision Level Description Example Type of Information Strategies Competitive advantage Market leader Long term New products that change the industry External events, rivals, sales, costs quality, trends. Tactics Improve operations without restructuring New tools to cut costs or imp- rove efficiency Expenses, schedules, sales models, forecast Operations Day-to-day actions keep company running Scheduling employees, placing orders. Transactions, accounting, HRM, inventory

11. Types of Information Systems

12. Systems Overview • Transaction Processing Systems • Collect data • Management Information Systems • Aggregate and collect data • Decision Support Systems • Analyze and warehouse data • Executive Support Systems • Provide higher level analysis • Executive Information Systems • Highest level summary of information

13. Decision Levels & Application Systems • Define the trends in terms of type, level, and decision maker as you move up the pyramid…

14. Processing Time: Batch • Typical in transaction processing systems • Data is entered over a period of time and is processed at a fixed interval • daily, weekly, etc. Terminals For Example: Mainframe

15. Processing Time: Batch • Works well for repetitive, routine transaction processing • Payroll, check processing, bill processing • Doesn’t work well for high-interaction operations such as Airline Reservation System • Prone to errors: • No immediate data validation • Separation of user from data

16. Processing Time: Real Time • Terminals attached to a central mainframe • Transactions are handled “live” and are processed as they are received • Changes can be live • Sources: • Point of Sale • Process Control • Electronic Data Interchange • Electronic Commerce • “Blackboard” uses both: • Updates to the course materials are real-time • Beginning of semester “auto-enrollment” is done in batch • Why do you think this is the case?

17. Management Issues • Price of data validation • “Pay now or pay later” • Performance Requirements: • Response time (fit with business model) • Batch windows (time) • Scalability • Do you plan for average volume or peak volume?

18. Business Process Management

19. Business Process Management • Business Processes • The functions an organization performs to add value to the business • Can be broken up into discrete steps • Example: Sales order process • The procedure that a company goes through to complete a sale to a customer • Business Process Management • Governance: oversight of key functions performed by the organization • Linkage to IS: an information system uses technology to perform a business process • Opportunities: corrective actions, standardization and/or continuous improvement

20. BPM: Linkage to IS • Recognize inefficiencies • Multiple people filling out the same form • Trace and correct errors • Lost orders • Incorporate new functions • Acquisition of a new business • Identify opportunities for automation through technology • Self-checkout at grocery stores • ATMs

21. Process Mapping • Forces thought on every component of the process • Help get consensus on process, boundaries, scope, responsibilities • Provides a foundation for other Analysis • User Requirements • Process Improvement / Reengineering • Organization Design • Infrastructure Planning • SOP Writing Source; Joseph Wootten, BPM Process Mapping Course

22. Process Mapping: Symbols Process Start / End Internal Process / Activity External Process / Activity Connectors Decision On-page Connector Off-page Connector Source; Joseph Wootten, BPM Process Mapping Course

23. Process Mapping: Approach Process Map Needed List as Many Activities as Possible Consoli-date Activities Individual A Further Consoli-date Activities Small Groups Name the Clusters Place Clusters in Order Add Decis. Points etc Connect Activities Cluster Common Activities Whole Group Deeper Analysis Required? No Yes Session Compete A Repeat Process Source; Joseph Wootten, BPM Process Mapping Course

24. Confirm Strategy with Executive Users • Define Project Scope • Define Organization • Build Business Case • Confirm Sub-Processes/ Activities with Users • Define Automated/ Manual Activities • Define Application Scope • Define Jobs/roles • Define Benefit Areas Sub-Processes Activities • Confirm Activities/ Tasks with Users • Define User Requirements • Define Information Needs • Define Skills • Define Procedures Tasks Process Mapping: Example Process Maps can be developed to varying levels of detail to serve a variety of design needs Process

25. Process Mapping: Example Level 0 animal requests and health research public/ zoo visitors zoo boostermembers donors other zoos& breeders needs and budgets PR data, receipts, etc. money and requests 4animalcare animal requests & and health research 1donor and public relations public requests employee schedule receipts/accounting reports Maintenance and building requests specialist request 3managehumanresources animal status Maintenance schedule hours and benefits 2producemanagementreports specialist request employees 5managezoofacilities Pay data, requests employee schedule management reports management usage reports certificationagencies

26. Process Mapping: Example Level 1 public/ zoo visitors donors zoo boostermembers money and requests money and requests PR data, receipts, etc. PR data, receipts, etc. money and requests 1.1produce PR& outreachprograms 1.2handledonorrequests 1.3org. boosterservices &meetings PR data, receipts, etc. donor lists needs and plans booster requests money, data, and visitor statistics needs and plans donor requests public requests 1.5produceaccounting &reports 1.4track needsand donorprograms receipts/accounting reports needs and budgets expenses and budget 4animalcare public requests 2producemanagementreports animal needs “Adopt an animal” database

27. Process Mapping: Checklist • Have we covered the core processes? • Have we mapped for the most common steps first, then managed exceptions later? • Have we covered the interfaces and handoffs? • Have we covered decision points and management process interfaces? • Do we have sufficient detail? • Have we involved the right people? • Do we have a consensus? Source; Joseph Wootten, BPM Process Mapping Course

28. Process Mapping: Next Steps • After defining the “To Be” process, be sure to record the following: • What are the Organization Implications of the new model? • Change in Jobs • Reorganization • What technology / tools will be needed to support the process? • What metrics will be used to measure the process? • Will any new infrastructure be needed? Note where “technology” enters the process here. Source; Joseph Wootten, BPM Process Mapping Course

29. Value Chain Analysis Source: http://en.wikipedia.org/wiki/Value_chain

30. Google Case Discussion

31. Google Discussion Questions • The case describes several of Google’s “products” (their search engine, Gmail, Google Earth, etc.). What do they have in common? How would you describe the line of business Google is in? • What is Google’s revenue model (how do they make money)? Who are its customers? With this in mind, what is Google’s real product? • Based on the material in the case, how would you describe Google’s strategy? Do they have one? • The last section of the case is titled “What Should Google Do?” What do you think Google should do (it doesn’t have to be one of the options described in the case)? Make sure you explain why you chose that course of action.

32. Porter’s Five Forces Evaluate Google based upon this framework… Source: http://en.wikipedia.org/wiki/File:Porters_five_forces.PNG

33. Next Week Systems Thinking and Managing Complexity